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August 15, 2010

Price Waterhouse to be investigated by SEBI

Price Waterhouse (PW) has lost its petition to stop the Securities and Exchange Board of India (SEBI) investigating the firm’s alleged role in the Satyam Computer Services fraud. The Bombay High Court ruled in favour of SEBI and also dismissed PwC’s appeal against its ban from auditing listed companies, Indian media has reported.

In its petition, PW, an Indian member firm of PricewaterhouseCoopers, argued that SEBI did not have jurisdiction over the audit firm as the case has nothing to do with the securities market. PW argued that only the Institute of Chartered Accountants of India (ICAI) could investigate firms’ professional conduct.

The ICAI supported SEBI’s authority to probe the allegations of irregularities against PW in the interest of shareholders.

PW has said it will consider filing an appeal in the Indian Supreme Court.

The Satyam Computer Services fraud unfolded in January 2009, when financial irregularities totalling about $1.44bn, the largest corporate fraud in India’s history, were discovered. PW was Satyam’s statutory auditor at the time the irregularities took place.

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